INCOME TAXES

9 Months Ended

Mar. 31, 2021

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

NOTE 11. INCOME TAXES

The Company and its non-Canadian subsidiaries file a consolidated U.S. federal income tax return. USCAN and Galileo file separate tax returns in Canada. See income tax information for Galileo in Note 3, Discontinued Operations. Provisions for income taxes include deferred taxes for temporary differences in the bases of assets and liabilities for financial and tax purposes resulting from the use of the liability method of accounting for income taxes.

For U.S. federal income tax purposes at March 31, 2021, the Company has no U.S. federal net operating loss carryovers. The Company has capital loss carryovers of $8,000 expiring in fiscal year 2023. The Company has no charitable contribution carryovers at March 31, 2021.

For Canadian income tax purposes, USCAN has no net operating loss carryovers and no capital loss carryovers.

A valuation allowance is provided when it is more likely than not that some portion of the deferred tax amount will not be realized. At June 30, 2020, a valuation allowance of $2.8 million was included to fully reserve for net operating loss carryovers, other carryovers and certain book/tax differences in the balance sheet. There was no valuation allowance included at March 31, 2021. In assessing the valuation allowance, the Company considered, among other matters, the nature, frequency and severity of recent losses, forecast of future profitability, and the duration of statutory carry back and carry forward periods.